Episode 61 – Expert Tips on How to Source Unique Private Label Products from China
You’ve got a great idea for a private label product to sell on Amazon and you know that you want to source it from China.
What’s your first step?
If you are Kian Golzari, the first thing you are going to do is crawl inside of it.
That is, if your product is a sleeping bag and you believe as he does that a product shouldn’t simply be a way to make money, it should first and foremost, offer great value.
In today’s episode of the Serious Sellers Podcast, Helium 10’s Director of Training and Customer Success, Bradley Sutton speaks with Kian Golzari, one of the world’s leading private label product development and sourcing experts who has personally sourced over 2,500 products for global brands such as Bed, Bath & Beyond, Tesco, Argos and Aldi.
Kian has won numerous international awards including the 2017 Sunday Times Fast Track Award for Top 100 UK Companies in Export Growth.
He was also awarded the 2012 Olympic Games contract to design, produce, and supply official merchandise.
But, let’s get back to Kian and his sleeping bag.
His father’s passion was camping and the outdoors so it was only natural that after college, Kian would, after joining his father’s company, find himself surrounded by both camping gear and tremendous opportunity.
He was given responsibility for sourcing and production and that’s where his particular combination of genius and determination helped him and the company reach new heights.
It’s not exactly a secret that China has been experiencing great change in the last decade. One of the largest has been in the exodus of the population away from the rural areas and into the cities.
In sourcing products in China, Kian was making that same exact trip, but in reverse. As more Chinese left their rural farm towns for the cities, it created a substantial difficulty for factories trying to find workers. Wages went up, but it still necessitated someone willing to delve deeper into the countryside in order to find those factories.
Kian refers to it himself as “being out in the middle of nowhere and coming up with ideas.”
One thing that he says that he has learned over the years is that the factory itself is one of the best places to develop products. Instead of sending emails and samples back and forth, having the ability to sit down with the sales staff or the factory boss and make changes then and there, is invaluable.
And, according to Kian, it has over the years saved him great amounts of both money and time.
He understands that not everyone can take a trip to China to start their Amazon selling career. Still, he says that after gaining a little traction, all sellers would benefit (and ultimately save money) from the huge upside of developing personal relationships with the “people” behind those sometimes-anonymous factories.
When it comes to the problem of unscrupulous sellers or factories copying his ideas; he’s got an answer for that as well.
Kian says that “relationships and genuine friendships with factories is his first line of defense.” As far as other sellers go, he’s too busy innovating to worry much about them.
Listen in and find out more about Kian as well as great tips on visas and product testing on the podcast.
In episode 61 of the Serious Sellers Podcast, Bradley and Kian discuss:
- 02:05 – How Does Someone Born in Scotland End Up Living in Shanghai?
- 02:50 – Coming Up with New Ideas Out in the Middle of Nowhere
- 03:37 – The Best Place to Create New Products is in the Factory
- 05:05 – Sourcing in the Heart of the Rural Country
- 07:40 – Alibaba is a Great Starting Point, but . . .
- 10:28 – Making His Own Niche by Creating the Best Product
- 12:00 – The First Step of Marketing is Product Development
- 12:39 – A Background in B to B Sales Makes Product Development Convincing
- 13:16 – A Rucksack Throws Bradley for a Loop
- 15:00 – Giving your Customer What They Want Doesn’t Have to be Expensive
- 15:25 – If I’m Developing a Sleeping Bag, I’m Spending the Night in It
- 19:08 – Straight-Forward Chinese Visa Tips
- 21:30 – Avoiding Common Chinese Sourcing Mistakes
- 22:42 – Chinese Manufacturers Love Volume
- 23:00 – Don’t Neglect Your Product Testing
- 25:10 – Product Testing 101
- 27:20 – Protecting Yourself and Your Product
- 31:35 – As Long as You Keep Innovating, You’ll Stay Ahead of the Curve
- 32:35 – How to Contact Kian
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Bradley Sutton: Today, we’re going to learn about the importance of creating the best possible products from a guy who has developed over 2000 products working directly with factories in China. How cool is that? Pretty cool, I think.
Bradley Sutton: How’s it going, everybody? Welcome to another episode of the Serious Sellers Podcast. I’m your host, Bradley Sutton. And with me, I have Kian on the line. Kian, how’s it going?
Kian Golzari: I’m all good. All good man. Bradley, how are you?
Bradley Sutton: I’m doing just delightful. You’re right now in the UK, right?
Kian Golzari: Yeah. Right now I’m in Scotland. Yeah. That’s where I’m based, but I’m heading out to the states next week. I always find myself between the US, China, and the UK.
Bradley Sutton: Okay, cool. Do you have a favorite place that you’ve been to?
Kian Golzari: You know what? I’ve spent the last 10 years living and working in China, and then I have some businesses that I work on in LA mostly. My favorite cities are definitely LA and Shanghai, but a home for me is Edinburgh, Scotland. It is a beautiful part of the world. I don’t know if you’ve ever been out to Scotland, but I would highly recommend it. To any of the listeners, definitely check out Scotland. It’s a beautiful place.
Bradley Sutton: All right, well if I go there, you’re going to take me to some of the best pubs out there, right?
Kian Golzari: Oh, for sure. Yeah. Well, so we’ve got great pubs, but also whiskey is our like national drink as well. I’m a big, big whiskey fan. I hope you are as well.
Bradley Sutton: Okay, well I haven’t been. I’m more of a tequila person living here in California, but I’m open to trying new things.
Kian Golzari: You know what? I’ve heard this, because you guys have a tequila room in your office as well, right?
Bradley Sutton: Exactly. When you come here to the office, you might have to donate a good bottle of whiskey, so it can be the tequila and whiskey room.
Kian Golzari: It would be my pleasure. Let’s lock it in.
Bradley Sutton: All right, cool. All right. Now, this is the Serious Sellers Podcast, but we’re talking about serious alcoholics’ podcasts right now. Let’s switch bases here. Kian, one of your main things I know is sourcing and being able to really find great factories. Now we had Steve Simonton on here before, but I wanted to do a little bit different podcast than what I did with him. He had a lot of good tips. But first of all, I wanted to talk just about you. Were you born in Scotland?
Kian Golzari: Yeah, yeah, I was born in Scotland.
Bradley Sutton: So how does somebody born in Scotland end up living in Shanghai? What’s the story there? How did that happen?
Kian Golzari: Well, I mean I was super lucky because my father started the business about 32 years ago. His passion was camping and outdoors. He started a brand called Highlander, where he started manufacturing a few products like tents, rucksacks, sleeping bags. And then, by the time I graduated university, he actually had a medium-sized business, and he was going over to China doing all the sourcing himself. So, when I graduated, he was like, “Hey, there’s this job for you. If you want at the company, you can take charge of all the production.” And I went to China for the first time, absolutely loved it. And then, I found a real passion for developing products, working with factories, going out into the middle of nowhere, coming up with new ideas. And then, from there, it just sort of spiraled out of control. I got really good at what I was doing. And then, other brands came knocking and then started partnering with other companies and working on licenses. So yeah, I got offered that position, which I guess is really lucky. You know, a lot of people have to work their way up. But when I graduated from university, I could just go straight into a sourcing job, but absolutely loved it.
Bradley Sutton: Talk a little bit more about what you just said: Finding products in the middle of nowhere. What do you mean by that?
Kian Golzari: Yeah, well because going back sourcing like 20 years ago, 15 years ago, a lot of big companies wouldn’t actually go to the factories. They would work with trading companies in Hong Kong or trading companies in Shanghai, and those people would go to the factory on their behalf. But I always found that to get the best results, you have to go to the factory directly. You know, you have to build a relationship with the boss, and the best form of making products is in the factory. When you want to make changes to a product and you can sit there and with the factory boss or with the sales staff and tell them what you want and then they make it there and then in front of you, think about all the time and money that you’re saving than if you were just sending samples back and forth to the office, and they weren’t really understanding you properly and we’re making it correctly.
Kian Golzari: But a lot of these factories traditionally set up at port cities to get goods out quickly, so near Beijing, Shanghai, all these places. But as these cities started developing, the factories could no longer be located there. And it kept moving more and more inland. And because I was spending so much time in China, I could see that. I would as soon as a new factory opened, like four hours rural into China, I would jump on high-speed rail and get into that factory. And the more rural you go, the lower the labor costs are, the better the labor skills they have. Because also China’s got an aging workforce in terms of the factory workers because of such growth in the middle class in China. Now the middle-class have got disposable income. They like to go to KFCs, Pizza Hut, Starbucks, nightclubs. So now, if you’re one young worker and you want to get a job, you’d much rather work in Starbucks rather than work in a factory. Factory workers are actually finding it a lot harder to get workers. And so as a result, you have to pay them a higher salary. Actually, a factory worker gets paid more than what someone at Starbucks would get paid, believe it or not. And then, these workers, they have to go to the rural areas to go and build those factories to actually get a hundred or 200 people who want to work in a factory. When I say, “going out into the middle of nowhere,” that’s actually going into the factory and doing and putting in the work basically.
Bradley Sutton: Okay. Then, I mean, just on the product production costs alone, the quality is better if you go into these rural areas as opposed to just the traditional hubs of where the factories always used to be. But now the cost of labor is higher there and so obviously, it means the cost of a product is going to be higher for possibly lower quality.
Kian Golzari: Well, I would just suggest you stay in touch and stay in tune with your manufacturer and take their advice or what they’re telling you because your manufacturer will move to other areas because that area is maybe close to the raw material of that particular product. So, for example, one of my favorite products to manufacturer is a backpack, but all the backpack factories are located nearby in the Fujian province in cities like Xiamen and Shinzo, and those factories are set up together. And a lot of people search for factories on Alibaba because they don’t necessarily have the time or what it means to go to China. But even when you search for a product, like a backpack, on Alibaba, you can see where the factory is located.
Kian Golzari: And if you just sort of follow the city, then you can find out the area which really specializes in that product. But, for example, a lot of people know that electronic products are made in Shenzhen area. But then, if you see a backpack made in Shenzhen, then you’re like “Woah! Are they really good factory because all the good factories are in the other cities and Shenzhen’s known for electronics?” What I’m trying to say is once you build up an understanding of what areas really specialized in what products, then you know you’re dealing with the right factory basically.
Bradley Sutton: Okay. Switching gears a little bit. A lot of people, they do product research using tools like Helium 10 and maybe they find what’s an opportunity, and back in the day, their process was, “Hey let me just go ahead and search for it on Alibaba and go ahead and buy it.” But a lot of people are still using Alibaba, but I think more these days, most just as a kind of search engine just to test the market. But if somebody is doing that, what are some indications in Alibaba that something might be a good opportunity or bad? In my mind or what I’ve heard people say is like, “If I search for one of these things that we found on Amazon, a burrito blanket. Absolutely crazy thing. But it’s selling really well on Amazon. But you look at burrito blanket on Alibaba, and there’s just pages and pages all of the same thing.” Now, would that be an indication like, “Hey, maybe you need to second guess this if there’s something like that where there are so many people who are also in the same thing or is that incorrect logic?”
Kian Golzari: I mean, personally I don’t really like using Alibaba because I feel that the best work is done with the factory directly, and I know a lot of people actually can’t get out to China themselves, so they do use Alibaba. But just be mindful of that. Alibaba works very similar to Amazon in that those suppliers are paying to get to the top of that listing. If you see a supplier number one or number two, they’ve paid to be there. Now do you really want to work with a factory who’s paid to get your attention? Whereas the best factories in the world and the ones that I work with, I find them at the Canton Fair in China; now their production lines are so busy, because they’re so good that they don’t even feel the need to list on Alibaba.
Kian Golzari: The reason I don’t like Alibaba is that you’re dealing with a lot of middlemen and you’re dealing with a lot of—not necessarily trading companies because trading companies still offer you a good service—but you’re dealing with a lot of resellers, and it’s so hard to tell, for a beginner, the real between the fake kind of thing. And as you said, there’s just so much traffic and so many products and so many items on there that it’s really, really hard to navigate. So, for that reason, I think that Alibaba and globalsources.com are good resources for you to get started and get your business going and become profitable. But once we do become profitable, that absolute next essential stage in your business is to visit the Canton Fair, because you can visit hundreds of suppliers under one roof, and you can find 10 to 20 suppliers making the same product in one row. So very quickly, feel the products, get an idea of who you’re working with, build your relationships, and then you’ve saved months of emails and sent examples, and you can accomplish that in one day at the Canton fair. But definitely, I think Alibaba and Global Sources are good tools for beginners. It’s just quite tricky to navigate between it.
Bradley Sutton: Yeah, I agree. What I’m wondering is if somebody is to follow your advice, their ultimate goal is like, “Hey, I’m going to go to the Canton Fair; I’m going to go to Yiwu; I’m going to go to wherever.” But in the initial stages, they want to kind of narrow down their product choices. Usually, when people do product research, maybe they come up with 10 different options, and they’re trying to narrow down to one. But in that example I gave of the burrito blanket, wouldn’t that be an indication to you that this could be either on the verge of saturation or something where if there’s like 20, 30, 40, 50, 60 different factories all kind of like showing the same product as opposed to maybe somebody searching for something else and there are only maybe one or two factories that are making this product. Wouldn’t that be an indication that it might be maybe a newer niche?
Kian Golzari: Yeah, for sure. If there’s a lot of the same products on a website like Alibaba, then you can tell that it’s a very, very congested space. Bear in mind that there might be 60 listings of that particular product, but 60 listings might all be buying from maybe a selection of five different factories, but different people have just made their own listing. But for me, the way I’ve always developed products is by knowing how I can make this product the best product in the marketplace. I always do my research. If I’m making a travel bag, I want to make sure that bag is the best travel bag in the market. And to be honest, I don’t really pay much attention to the competition. I just go out of my way to say, “Right, what does every traveler need?”
Kian Golzari: And then I write those things down and I’m like, “Right, how can I then put those things into a backpack?” And then I work with my supplier to really develop something innovative. I guess there’s kind of like two models. Are you a product developer where you’re striving to develop the best possible products in the market and then put it out and build your brand that way? Or do you just want to be a reseller and then basically sell what products are available to you? Personally, I much prefer developing products as opposed to just sort of taking what’s available out there. But it really depends on what your skillset is. Because if your skills are just marketing and traffic and conversion and things like that, then maybe you just do want to take a product, because you’re so skilled at the other things. But my skillset is kind of like developing the best products. So that’s why I really, really like to focus on developing.
Bradley Sutton: So, basically, what you’re saying is you would even consider going into a little bit more competitive markets, knowing that you can differentiate your product and make it better?
Kian Golzari: For sure, for sure. I strive to make the best products in the market, and I don’t like to just sort of take a concept that’s selling and then try and… because how long have you got your listing? How long are you going to be competitive before everyone else jumps into the marketplace and everyone’s selling the same thing you do? But if you’ve innovated something yourself, you know that you’re first in the market with that product. And then, because I always believe that marketing is a very, very important aspect of the business, but the first step of marketing is product development. What is it in the product that you can now market, which is different from everyone else? I think you definitely have to specialize in your product first and then that follows through into your marketing.
Bradley Sutton: Okay. That’s good advice I think for anybody. Now, do you have any examples of either one of your products or maybe one of your clients’ products where normally the traditional sense would have been like, “Oh no, stay away from that category,” but because they did that exact thing, and they were able to differentiate something or do something higher quality, they were still able to have a good launch and a successful product because of using that strategy that you just detailed?
Kian Golzari: Yeah, my background is kind of like B2B, business to business. In the last sort of 10 years, I’ve been working the first eight years with retailers. So, luckily, whenever I developed a new product, I just had to convince the buyer of that store, whether it was a UK big-box retailer or a US retailer. I would say this is the best product and then that was enough to convince them to then place the order for their hundreds of stores and that would result in very big orders. But for me, I developed an outdoor rucksack under our family business Highlander, which was the Ben Nevis rucksack. And I named it that because Ben Nevis was the tallest mountain in Scotland, and I wanted it to be the…
Bradley Sutton: Wait, wait, hold on. I think because of the accent here, I can’t understand what you just said. So what is it and what kind of product?
Kian Golzari: Oh, so a rucksack, a backpack. So yeah.
Bradley Sutton: Wait, so spell it. Spell the…. “Sack” I heard. Spell the first word.
Kian Golzari: Rucksack. R. U. C. K. S. A. C. K.
Bradley Sutton: I have never heard of that in my life. I’m going to Google it right here. Hold on. This is interesting. So, rucksack. Oh, it’s one word.
Kian Golzari: Yeah, one word.
Bradley Sutton: Whoa. I have never… Yeah, it’s like basically the backpack. Okay. The first thing it says, “What is a rucksack?” A rucksack is not a backpack. It says, it has a military… Okay. it’s like a military backpack.
Kian Golzari: You know, this is why your Magnet tool is so good, because I would list it as a rucksack. And you don’t know what it is, so you would never look for that.
Bradley Sutton: Yeah.
Kian Golzari: But yeah, so it’s basically an outdoor backpack, you know, capable of climbing Mount Everest, and I made a 65-liter and 85-liter backpack, and I just set out to make the best possible rucksack that I could. And then, it got picked up by a magazine in the UK called Trail Magazine, and they had this thing called Test of the Best, and they compared it against all this sort of market leaders, like US companies, like Osprey, and then European companies like Deuter, Vaude, all the market leaders. Their backpacks were sort of retailing at $200. Ours was retailing at $115. We were almost like half the prices for those guys, but our product outperformed them. We scored much higher. And that just shows the extent of how good you work with your factory and how good your product development skills are and what you’ve put in your product that other people don’t have.
Kian Golzari: It’s not necessarily a price game. Everyone just assumes that like, “Okay, if I pay a lot of money for my product than it’s higher quality. it’s not. You can still be much cheaper than your competitors, and you can still be much better than your competitors if you just focus on the actual development process and adding value to the customer, knowing what your consumer wants and being able to give that to them. It doesn’t always have to be expensive. So that’s just one way of being able to differentiate from everyone else’s. I also talk about product usage a lot as well. Like if I’m developing an outdoor rucksack, I’m going up a hill and I’m climbing it. If I’m developing a tent, I’m sleeping in it. If I’m developing a sleeping bag, I’m going to sleep in it. Whereas too many people, I think they just sort of see a product online and they’re like, “Okay, cool, I’ll go for that.“ They purchase it, and they put it online, and then they only sort of realize the flaws in the product once you start to get negative reviews, but you’re your toughest critics, so you have to thoroughly test your own products yourself and then you can sort of come up with the benefits for yourself as well before you actually put it online so you can add the most amount of value to your consumer.
Bradley Sutton: Okay, that’s awesome. And you brought up an excellent point, and this is something I talk about with people too. A lot of people, what they do is they make a great listing for the Amazon USA and American customers, and it’s crushing it. So now their next step is, “Hey, I’m going to go ahead and expand to Amazon Canada.” “Hey, it’s an English-speaking country. I’m just going to copy my listing.” And I say, “No, you’ve got to run Cerebro and Helium 10. You’ve got to do your entire keyword research again, because Canadian people search for different things, like, I forgot what it is—even in an England and Scotland, what do you guys call a baby’s diaper?
Kian Golzari: No idea. I don’t have any kids. Oh, we call it a nappy actually.
Bradley Sutton: Yeah, exactly. Nappy in America, that means like you have messy hair like you have nappy hair, but you know the door of the car where the engine is under—in the front. What do you call that?
Kian Golzari: We have the boot in the back, but you guys call it the trunk.
Bradley Sutton: And we call it the trunk. And with the front one, do you know what it is?
Kian Golzari: We call it the bonnet.
Bradley Sutton: Exactly. A bonnet is something that goes into the hair in America. It’s called the hood in America. What was the word I just searched? A rucksack is maybe what anybody in Europe might search for. But I’m assuming, maybe it’s just because I am a culturally not educated here, that maybe there are a million people in the US who search for a rucksack. But in my mind, it’s more like a tactical backpack or a military backpack. Right. But so it’s important guys, whatever your product is, make sure you do the research in the country that you are actually going to sell in. And the same thing goes for when you’re going to expand to Amazon Italy, Spain, Germany. Don’t just do a direct translation because even those words are different sometimes or the way that people search for products in different countries are different.
Bradley Sutton: So anyways, there is a great moral of the story of my vocabulary lesson of rucksack today. But speaking of outdoor backpacks, have you ever made a hydration pack like the cyclists use or hikers use?
Kian Golzari: Yes, we make those as well?
Bradley Sutton: I don’t know if you knew this or not, but I have never launched my own private label product. I used to be a consultant for Amazon sellers. I launched over 400 products, but it was all for other people, never for myself. But there was a certain kind of hydration backpack where I was like, “You know what? If I ever do make my own private label product, it’s going to be this certain kind of hydration backpack that there’s very little competition on.” I’m thinking I might do a case study about, “How to do the whole process here.” But would you be interested in doing that with me if I do decide to do this hydration backpack?
Kian Golzari: Absolutely, I could knock it out for you in 24 hours.
Bradley Sutton: Let’s do the Kian and Bradley show, the Kian and Bradley case study. All right, we’ll have to talk about that after this episode. I am a hundred percent serious about that. It’s something I’ve been wanting to do for a year, and a half and even though I’ve waited this long, it’s not like it’s been saturated. It’s still the same players out there. I don’t want to give it away, because people faster than me are going to go and jump on it. But I’m going to talk to you offline about that
Kian Golzari: Let’s do it.
Bradley Sutton: All right, cool. Let’s go back to talking about China a little bit, and I know you take people out there on trips, and we’ll definitely talk about that towards the end of this episode, but for people who would go with you on one of these trips, these sourcing trips or people who just want to go themselves to the Canton Fair, for people in Europe and for people in the United States, what are the visa requirements these days for people who want to travel to China?
Kian Golzari: I mean, it’s always been pretty straightforward. I’ve always just gone to the Chinese Embassy. I’ve got one in Edinburgh as well, and then just apply for a two-year visa, multiple entry. You just apply for it, and once they stamp it, for the next two years I’m free to come and go with to China as I please. And I think that I’ve had visas which are three month per entry, six months per entry. But one very important thing that a lot of people have to consider is that people just think they’re going to go to China once. They just apply for a single-entry visa. And then, when they’re in China, they did decide to go to Hong Kong, and not a lot of people realize that we’re actually crossing the border. I have known on a lot of trips, people are in China for phase two of the Canton Fair, they go to Hong Kong, and then they can’t get back into China because they never got multiple entries or a double-entry visa. So, if you are going to China, just bear in mind that if you do want to go to Hong Kong, you need to get double-entry visa.
Bradley Sutton: Okay. That’s definitely good to know. And you know, a lot of American people take these kinds of things for granted, because basically if you have an American passport, usually you can just almost just go to any country you want. And so that might be a foreign concept to a lot, like “What do you mean you have to go to the embassy?” But yeah, I believe still here you have to get the Chinese embassy in the United States to approve your visa, and it requires sending them your passport and then they send it back to you. So, you can’t just expect to, “Hey, let me book a flight to China,” and I just get there and they stamp it. I mean 99% of the countries in the world, US passport gets you anywhere but not in China without that visa. So that’s something important.
Kian Golzari: Yeah. And normally, when you go to China as well, you need invitation letters. If you are going to visit a manufacturer, sometimes you can just get your manufacturer to write a quick letter with a company stamp to say, “We are permitting Bradley Sutton to come into China to visit our factory and to talk about business.” And then you just print that letter out and you take it in with you on your visa application. And if you don’t have a supplier in mind that you want to see, then even the Canton Fair write invitation letters as well. I think you can download it from their website. So before booking any visa appointment, just double check what the documents you need to actually provide them with as well.
Bradley Sutton: Okay, excellent. Excellent advice. Thank you for that. Now, people go to you to help them source products or find products or find manufacturers. And I would imagine that some of these people probably give you horror stories of why they’re even going to you in the first place because they’re like, ‘Man, I tried to do this on my own” or “I use somebody else and this and this happened. I need you to save me.” In your 10 plus years’ experience, 10-20 years’ experience, what are some of these common things that people have done that makes you want to pull your hair out because you wish that you were there to help them. Here’s your chance now to help others who maybe haven’t taken that leap. What should they avoid?
Kian Golzari: You know, that’s such a great question. I’m really glad you asked because this is probably going to save a lot of people a lot of trouble. But what I’m really amazed by is that with all the Amazon sellers, they are so good at essentially generating so much traffic and movement on their listing and a lot of sales, but their pricing is terrible. When I hear the volumes that some of the sellers are doing, and I hear the price that they’re getting, I’m just dumbfounded. And it’s really because a lot of people start off by funding their manufacturer on Alibaba, but that was probably the best manufacturer for them to get started because they’re very flexible to their needs. But now that they are an established and big business, they can really be working with the best manufacturers in China and getting the best prices.
Kian Golzari: And a lot of them have outgrown their supplier. Their supplier might even be taking their orders and giving it to other factories, because they’re too small to fulfill their orders, and they just don’t know about it. And when I work with people who come to China, I take their product and take their price. I actually get them the best manufacturer, and they can’t believe how much they’re actually saving by actually working. Because these Chinese manufacturers, they really love volume, right? And if you say, “Oh hey, we’re doing 50,000 units a month.” They’ll bite your hand off to get that order. Sometimes, they would even make the first order just above breakeven just to get your business. That’s how desperate they want your order, and people aren’t really taking advantage of that.
Kian Golzari: The other big point is that there’s a severe lack of testing. I feel a lot of people just assume that their product is fit-for-purpose. I met someone, an Amazon seller who has a sad story; they’ve pretty much invested their life savings into their product, and it was within the fitness category, and they basically didn’t apply for any testing on their product, and it was an item that you could heat up in a microwave or have it cool in the freezer and then rub it on your body. But because the testing procedures weren’t followed, someone bought the product, put it in a microwave, the product exploded, and caused a minor injury. Amazon pulled it; it said this is not fit-for-purpose, didn’t have any testing certificates in place to say that their product was fit for use.
Kian Golzari: The product got pulled and then the life savings are in the inventory, and what can you do with that, you can’t sell it anymore. But if you decided to get the product tested at the source, you would have found out the product didn’t pass the testing. Either you don’t pay your supplier, or you don’t ship it, or you fix it before you ship it. But when you sort of ship something, which you don’t know if it’s going to pass testing and then you ask for a testing report, then you’re basically wiping out your stock. So, product testing. And also, you’re not expected to know what standards you’re supposed to test for but reach out to a testing house. There’s so many of them. There’s Intertek, BV, SGS; there’s so many of them. And you can basically say, “Look, this is my product and I am bringing it into the UK or US or Spanish market. What are my legal requirements to test for this product?” And they’ll say, “Well, you need to test for this chemical.” Or if it’s electronic, they’re like, “It needs to be this certain voltage.” And then you just relay that information back to your factory and say, “Make sure you pass this before shipping.” And then you can get the same third-party to actually carry out the testing for you. And it’s not even that expensive, depending on what your product actually is. Testing is not that expensive, and wouldn’t you much rather just have the peace of mind that you’re shipping a product that’s fit for purpose? It’s not going to cause any harm. And then, you are good to go.
Bradley Sutton: Yeah, that’s actually great advice. So how does it work? When you’re negotiating with the factory, they’re going to make a thousand units or 5,000 units, is there something then that you have to say in the contract, like “Hey, before you start, I am going to use XYZ quality control company and they’re going to test.” How do you make it so that they know that if it fails a test, they’ve got to start over again? What’s the process usually with that?
Kian Golzari: For sure. Definitely, before production starts, you have to stipulate what you want to test for, because, for example, if you’re doing kids toys and there was a certain chemical in that toy, like for the paint or something, that they’re using. And let’s say that chemical is a banned substance. Then, before even purchasing that chemical or going into production, they know that they can’t use that particular item. I would say, “Look, I want to manufacture this toy and it needs to pass these standards in the United States.” And then your manufacturer would make one sample and then send out the sample to the testing house. They would test it. So, okay, this product is fit for purpose. It’s passed the test. And then, they would go on and order all the raw materials and then start production. But the last thing you would want to do is order 20,000 of this toy and then find out it failed the inspection and then the manufacturer is like, “Well, it’s not my fault. You didn’t tell me that you didn’t want these hazardous materials.” So definitely before starting any production, you have to stipulate what it is that you definitely want. And here’s the thing, there are certain products that have legal requirements, like a kid’s toy or adaptor or like a travel plug or something like that, like electronic requirements, but some of them just have like industry standard requirements, like say, for example, a backpack. You want to test the zip that it doesn’t break. There are certain machines that will pull the zip up and down 10,000 times or they take the fabric and they pull it at certain weights and then it has to reach a certain level before the fabric tears. And then it’s sort of industry standard. That’s not a legal requirement. You can still send your backpack without it and it can be really cheap and have nasty stuff and you’re not going to get your listing pulled. But if you know what the industry standards are, and again, you can ask these testing houses what the industry standards and then test it with those requirements. You know that you’re bringing in a product which is basically above standards for your market.
Bradley Sutton: Okay, that’s great to know as well. Now here’s something I believe I had talked to Steve about too, but it’s such a prevalent question and fear, and I want to bring it up with you again too. A lot of people are paranoid, especially if they don’t have the means to go and negotiate in person. Or even if they do, their fear is because of the horror stories they’ve heard. How do I keep that factory from just turning around and repackaging my product and selling it themselves on Amazon or selling it to somebody else? How do I protect myself? Now, here’s my theory. You can tell me if this is true or not, but I would imagine that somebody like you obviously brings different clients or different customers to the same factory, because they’re making different products, right? So then, really, in this case, the factory would almost have even more incentive. It’s like, “Man, I’m not going to do this person wrong because, hey, Kian’s going to take everybody’s business away from me.” Is that one way of making sure or lessening the chance of something happening—using individuals like yourself? If you can understand what I’m trying to say.
Kian Golzari: No, no, you hit the nail on the head because like, let’s say for example, you place, I don’t know, two or $3 million worth of business to one factory, which was for 20 different products, and there’s one particular product which was only maybe $50,000 of turnover. Now, they’re like, “Do I really want to copy this guy to make an extra $50,000 when I’m getting $3 million worth of turnover?” It’s not worth the risk. So, they’re less likely to mess with you if they really, really value your business. And that’s why I would sort of place emphasis on the relationship that you have with your factory. I can’t stress that highly enough. Working very, very closely with your manufacturer and building up a genuine friendship. It’s not us versus them. It’s like “now we’re in this together, we’re in a partnership. What works for me works for you.”
Kian Golzari: But let’s say, for example, you’re placing your first order and you haven’t had the chance to really build up that relationship and you’re worried about a Chinese manufacturer copying your product. Well, what you can do is design register your product in your home market. So, if you’ve come up with a new concept or a new product, patent it or design register it and protect yourself in your home market. So let’s say, they do copy your product and you do this on Amazon or they sell it to one of your competitors, then you can basically pull their listing to say, “Hey, I’m the only person which is allowed to sell this product. This is my patent, or this is my design registration.” And then they’re required to then pull that. Depending on how much it would cost to register your design or your product, definitely consider that.
Kian Golzari: And oh, here’s the other thing I do as well. Even if I’m worried about a manufacturer copying my product, I would just tell them, “Look, I’ve design registered this in the UK, US, and Europe,” and I’d just even give them a fake number. And they’re never actually going to check and go through the legal system to see if we actually have registered it. But I just tell them that I have registered it just to scare them off, so they’re like, “Okay I’m not going to mess with this guy because he’s obviously going through the legal processes.”
Bradley Sutton: I mean, be honest. Now has that ever happened to you where somebody has either your products or one of your clients’ where the factory just have desperate times and you catch them backdooring it or something?
Kian Golzari: Luckily, I’ve got great relationships with our manufacturers, but I’ve got so many. I mean I’ve developed over two and a half thousand products in China. It was bound to happen a few times, and it has happened. Like, for example, I went to one factory, and I developed this new outdoor backpack, and I developed it with them in the factory. I put all my finishing touches on it. Really, really liked the product. Anyway, I never actually ordered it, because I had enough backpacks in my range for that year. I was like, “Okay, maybe I’ll bring it out next year.” And then, later on in the year, I found that exact same product in one of my competitor’s catalog. So basically, one of my competitors went to the factory, saw this product and are like, “Oh, I like that.”
Kian Golzari: And then the manufacturer is like, “Yeah, okay, go for it.” And just put their logo on it and then they ordered it. So, it does happen. But that person as a result lost our business. And if anyone ever copies my product, I just take it as a compliment that I’m good at what I do, and someone actually wants to copy my product. I don’t really let it bother me whenever someone, if anyone, does go after my product. Because I love innovation so much, even if someone does copy a couple of my products, by the time that it actually hits market, I’m already working on the next thing. The other thing is that the domestic market in China is quite big as well. So let’s say, for example, a factory does want to copy your product.
Kian Golzari: They might copy it and just sell it in their local town, or they might just sell it in China. I’ve been to China so many times, and I saw some of the products I developed with factories just in the China market. And when I called up the factory about it, they said, “Yeah, we made an extra couple of hundred pieces, and we just sold it locally.” And again, I was like, “Well, I’m not really selling in China.” So that doesn’t really bother me. But I still said, “You know, that’s not cool. You’re not supposed to do that.” But you know, it happens. And I think it’s probably happened to a lot of people, and they just know they don’t even know about it. So as long as you keep innovating, you’ll always stay ahead of the curve.
Bradley Sutton: Yeah, I mean I know at some point, imitation is the best form of flattery, they say so. It’s kind of cool that they think your product is cool. Like one time I remember, I used to be a Zumba fitness instructor and I had a YouTube channel that got 30 million views. and I would travel the world doing Zumba. Well, I had all these videos up, and then somebody called me one day like, “Hey, I’m on vacation here in—I forgot if it was Peru or Chile or somewhere in South America.” And you know how there’s like street vendors who sell DVDs? Well I guess somebody had actually made a full DVD series of my Zumba YouTube videos and that actually to me was kind of cool, because I never made money really. I never sold my Zumba videos. I was like, “Well that’s kind of cool that somebody actually liked my videos so much that they’re selling it on the streets of South America.” But when we’re talking Amazon business, obviously the attitude would be a little bit different because it’s taking money potentially out of your pocket.
Bradley Sutton: Well, Kian, thank you so much for coming on here. Now I’m sure I have some more questions that I’m going to get to ask you because we’re going to get off this call and we’ll continue talking, but for the other people who have questions that they haven’t got answered or they want to learn about your different trips to China. I know you just love helping sellers with their sourcing question. So how can they find you or how can they reach you?
Kian Golzari: Sure. Actually, I just started a Facebook group a couple of weeks ago, and it’s just called Sourcing with Kian. That’s Kian, K I A N. It’s just a group on Facebook, completely free, no upsells of course; there’s nothing like that. If you’ve got a question, I jump in and normally answer it within 24 hours. Sometimes, we’re making videos; sometimes the community answers the questions. I would say if you want some sourcing advice, go to Sourcing with Kian on Facebook. The other thing is, yeah, there’s a China trip I help out with called China Magic. And there’s a website called Chinamagictrip.com where I’m one of the mentors on the trip, and we basically visit phase two of the Canton Fair, Global Sources in Hong Kong and then phase three of the Canton Fair. And we go and find products, and I’m there with you because I’m in China sourcing my own products at the same time. But I’ve got a great opportunity where I can help Amazon sellers at that time as well. We look at products together, negotiate prices, and then at night we sort of mastermind. If you want more information on that, you can join my group or send a message or go to chinamagictrip.com.
Bradley Sutton: Perfect. All right, Kian, thank you very much and we’ll hope to have you back here on the show in the future.
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